Unusual Situation - what options do I have?

Light_5peed

Hi

I currently live in a house and I am 2 years into a 5 year fix mortgage (mortgage £100k / house value approx £200k).

I also own, outright, another property valued at approx £220k that I inherited around 5 years ago.

My plan has always been to eventually extend my current home and I have recently began the process of putting the wheels in motion in order to do this. However, following consultation with architects/builders it appears that a more sensible option would be to do this work on my other property and subsequently move in. This is partly down to the existing layouts and size of the plot. While this wasnt something I initially considered it does now seem to be the better option.

If I was to go down this route I intend to keep my current home to rent out.

I am now a little unsure of the best next step.

Do I consult my mortgage company (Santander) regarding Consent to Let? If so, is this likely to be agreed until the end of the fix period?

Could my current mortgage be ported to the other property? No additional borrowing is required.

Understandably I want to avoid having to remortgage to a buy to let and incur ERCs.

Thanks in advance for any guidance.

dimbo61

Well this depends on your current lender Santander.
Do you have the money to pay for the work you want doing?
Can you get a good return from renting your current home.
Will you get Consent to let ?
Can you port the mortgage ?
Down to your lender
so speak to them

Thrugelmir

Give Santander a call and sound them out about letting the property.

The mortgage cannot be transferred as you already own the other property.

AnotherJoe

Why would you let out your existing home ? Rental,profits are generally low, can be risky, are subject to government interference.
Have you considered the cost / profit taking into account a higher mortgage rate on your main residence ?

Moneyminded

Do you actually need the 2 properties? If the layout of the property you inherited is better for your needs and is still close to your work/ friends/ family etc then it makes sense to extend that one. Once the works are done and you can move into the house could you sell your existing home?

Yes you could rent it out as you mention but do you want to be a landlord? Do you have any experience of being one? If you sell your current home it sounds like you would have the best part of £100k after legal costs and the ERC which you could then invest in other ways.

Out of curiosity if you already owned the house you inherited when you bought your current home why didn't you just move in there? What was it about your current home that better met your needs?

getmore4less

what has been done with the other place for 5 years?

Stenwold

As stated in a previous post, you won't be able to port your mortgage as you already own the property. Best bet is to speak to your lender about CTL - this option is usually available for a shorter period but they may agree to get in contact every 12 months to see if your circumstances have changed (I've known this to happen a few times).

Light_5peed

Thank you for the replies.

In short, I already owned my current home when I inherited the second and had done for some time and was a landlord for a few years on the second home.

While I don’t need 2 properties my preference is to keep both as I see this being the best solution for me and family long term and we don’t not need to raise any cash to complete any building work.

Basically since having a second child we have realised that we need more space but never really considered moving as we are quite content where we are and for personal reasons I also didn’t feel that this move would ever be something I considered.

That said, things change and all things considered moving seems to be the better fit.

I will speak to the lender.